Inflows of speculative investment money into gold, copper and oil continue unabated and the numbers are staggering.
I wrote a few months back about investment inflows into commodities setting a new weekly record, at just over $1 billion. In November and so far into December that record has been left in the dust.
As of December 2 (the last date for which we have data), global investment inflows into commodities had run over $1 billion weekly for three weeks straight.
In the week from November 12 to 18, a new record was set: $1.341 billion. Nearly 30% higher than the previous weekly record.
The following week, November 19 to 25, was nearly identical. With an additional $1.336 billion flowing into commodities investments.
And the week from November 26 to December 2 rang up another $1.138 billion.
A little perspective on just how inflated these numbers are. Since the beginning of 2009, an estimated total of $17 billion has been invested worldwide in commodities. $4.4 billion of that has come in just the last month. That's a 35% increase in less than 30 days.
This size of speculative inflow is unparalleled, plain and simple. The bigger question is: will all of this hot money stay parked? If metals prices start to fall (as gold has been the last few days), will investors get spooked and head for the hills?
Hot money can drive investments up quickly. And it can drive them down just as rapidly when it exits. Given the size of investment that has been made over the last several months, much of what happens with commodities prices going forward is going to depend on this balance.